News Release!
Thursday February 18, 4:26 pm Eastern Time
Company Press Release
Dynatec Corporation Announces Year End
Results
RICHMOND HILL, ONTARIO--Dynatec Corporation today announced that for the year ended December 31,
1998, the company posted revenues of $144.5 million and net earnings of $5.1 million or $0.045 per share.
Earnings before interest, taxes, depreciation and amortization (EBITDA) totalled $18.0 million for 1998
compared to $18.1 million in 1997.
Revenues for the year ended December 31, 1998 were $144.5 million compared to pro forma revenues of
$163.8 million for the same period last year. Net earnings for the year were $5.1 million or $0.045 per share
compared to pro forma net earnings of $5.2 million or $0.046 per share for the same period last year.
Revenue for the fourth quarter totalled $28.0 million compared to $42.1 million for the same period of 1997.
EBITDA for the fourth quarter of 1998 totalled $3.7 million compared to $4.9 million for the same period of
1997.
Net Earnings for the fourth quarter of 1998 totalled $0.6 million compared to $2.2 million for the same period of
1997.
''In spite of a substantial downturn in the mining industry in 1998, Dynatec has improved its financial strength'',
said Robert Dengler, Chief Executive Office of Dynatec Corporation. ''At the same time, low prices for metals
and other commodities should present many more opportunities to pursue our strategic objectives of leveraging
our inherent expertise into direct investments in the mining industry'', Dengler added.
Dynatec Corporation, based in Richmond Hill, Ontario is a widely held Canadian public company that provides
a broad range of services, principally to mineral exploration, mining and refining companies in North America
and internationally. Its business is comprised of three divisions: mining services, drilling services and
metallurgical technologies.
DYNATEC CORPORATION
CONSOLIDATED BALANCE SHEETS
December 31, 1998 and 1997
(In thousands of dollars)
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1998 1997
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ASSETS
Current assets:
Cash $ 26,379 $ 24,857
Accounts receivable 22,260 25,691
Inventories 19,122 21,463
Prepaid expenses and other assets 1,624 1,836
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69,385 73,847
Capital assets 42,663 42,678
Other assets 383 286
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$ 112,431 $ 116,811
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Bank indebtedness $ 3,484 $ 13,253
Accounts payable and accrued
liabilities 14,697 15,620
Income taxes payable 3,136 833
Deferred revenue 887 2,662
Current portion of long-term debt 3,101 4,026
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25,305 36,394
Deferred revenue 180 450
Long-term debt 11,141 11,344
Deferred income taxes 3,410 3,103
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Shareholders' equity: 40,036 51,291
Capital stock 59,489 59,451
Cumulative foreign translation
adjustments 2,284 561
Retained earnings 10,622 5,508
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72,395 65,520
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$ 112,431 $ 116,811
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DYNATEC CORPORATION
CONSOLIDATED STATEMENTS OF EARNINGS
Years Ended December 31, 1998 and 1997
(In thousands of dollars - except for per share amounts)
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Pro Forma
1998 1997 1997
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(unaudited - see
Revenue: Note 1)
Contract revenues $ 144,502 $ 163,772 $ 61,564
Contract expenses 113,195 133,915 48,312
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31,307 29,857 13,252
Other revenues 1,252 1,580 288
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32,559 31,437 13,540
Expenses:
General and administrative 14,524 13,384 4,442
Depreciation and amortization 6,900 8,119 2,179
Interest 2,014 2,319 704
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23,438 23,822 7,325
Earnings before income taxes 9,121 7,615 6,215
Income taxes:
Current 4,130 1,126 1,126
Deferred (123) 1,287 727
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4,007 2,413 1,853
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Net earnings $ 5,114 $ 5,202 $ 4,362
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Basic earnings per share $ 0.045 $ 0.046
Fully diluted earnings per
share $ 0.042 $ 0.039
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DYNATEC CORPORATION
CONSOLIDATED STATEMENTS OF RETAINED EARNINGS
Years Ended December 31, 1998 and 1997
(In thousands of dollars)
---------------------------------------------------------------
1998 1997
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Retained earnings at beginning of
year $ 5,508 $ 1,602
Net earnings 5,114 4,362
Share issue costs (net of tax effect) - (456)
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Retained earnings at end of year $ 10,622 $ 5,508
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DYNATEC CORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN FINANCIAL POSITION
Years ended December 31, 1998 and 1997
(In thousands of dollars)
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1998 1997
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Cash provided by (used for):
Operations:
Net earnings $ 5,114 $ 4,362
Items not involving cash:
Depreciation and amortization 6,900 2,179
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12,014 6,541
Change in non-cash operating working capital 5,856 ( 9,549)
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17,870 (3,008)
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Financing:
Issuance of common shares and warrants - 35,000
Issuance of common shares on
acquisitions of Dynatec International Ltd. - 22,480
Warrants exercised 38 -
Repayment of long-term debt (4,431) (2,322)
Increase in long-term debt 3,016 1,017
Share issue costs (net of tax effect) - (456)
Contribution of capital - 128
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(1,377) 55,847
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Investments:
Acquisition of Dynatec International Ltd. - (45,217)
Additions to capital assets (6,956) (4,580)
Proceeds on sale of capital assets 1,754 619
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(5,202) (49,178)
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Increase in cash 11,291 3,661
Cash at beginning of year 11,604 7,943
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Cash at end of year $ 22,895 $ 11,604
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Cash is comprised of Cash and Bank Indebtedness
DYNATEC CORPORATION
CONSOLIDATED STATEMENTS OF EARNINGS
(In thousands of dollars - except for per share amounts)
(unaudited)
Three Months Three Months
Ended Ended
Dec 31, 1998 Dec 31, 1997
---------------------------
Revenue
Contract revenue $ 27,991 $ 42,081
Contract expenses 21,052 33,179
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6,939 8,902
Other revenue 432 27
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7,371 8,929
Expenses:
General and administrative 3,702 4,013
Depreciation and amortization 1,626 2,081
Interest 375 427
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5,703 6,521
Earnings before income taxes 1,668 2,408
Income taxes 1,026 160
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Net earnings $ 642 $ 2,248
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Earnings per common share:
Basic earnings $0.006 $0.020
Fully diluted $0.006 $0.016
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Weighted average number of shares
outstanding (thousands) 113,593 113,528
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DYNATEC CORPORATION
NOTE TO CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of Presentation
On September 30, 1997, Sherritt International Consultants Inc.
("SICI") was reorganized through a series of transactions and
acquired all of the outstanding shares of Dynatec International
Ltd. ("Old Dynatec"). Immediately after the acquisition of Old
Dynatec, SICI was renamed Dynatec Corporation.
The consolidated balance sheets are at December 31, 1998 and 1997,
the statements of changes in financial position are for the year
then ended and the statements of earnings are for the three month
period and year then ended.
The pro forma statement of earnings gives effect to the
reorganization as at the beginning of the period indicated. |
